Another Arrest in News Corp. Phone Scandal

Date Published: Monday, July 18th, 2011

Rebekah Brooks, former Senior Executive of News Corp., was arrested for her suspected involvement in the recent phone-hacking scandal. On Sunday, Brooks was taken into custody for being connected to the publication’s interception of individual’s voice mails and bribery of police officials, reported the Wall Street Journal.

On Friday, Brooks resigned from her position at News Corp., and today, is scheduled to testify before the U.K. Parliament regarding the hacking allegations.

Brooks, along with Rupert Murdoch and his son, James Murdoch, will face questions today about whether they misled Parliament in a 2003 investigation regarding allegations that police officials were paid for information.

According to a report by the WSJ, as recently as 2009, executives from News International told the Culture, Media and Sport committee the hacking issue was limited to one reporter employed by the News of the World.

Last week, Murdoch closed the 168-year-old tabloid after reports revealed the publication’s employees hacked voice mails of murder victims and victims and their families of the Sept. 11, 2001, attacks.

In 2003, Parliament asked Brooks whether News Corp. bribed police officials and she responded, “We have paid the police for information in the past.”

She did not elaborate on the statement but said in a letter to lawmakers that her statement was meant to comment on a “widely held belief,” says the WSJ, rather than suggest she was aware of specific instances where police were paid for information.

Earlier this month, Rupert Murdoch said that News of the World and News International failed to “get to the bottom of repeated wrongdoing that occurred”, and as a result, “wrongly maintained that these issues were confined to one reporter,” reported the WSJ.

The resignation of Sir Paul Stephenson, Metropolitan Police Commissioner of the Scotland Yard, has sparked the allegations that in 2006, members of his force failed to investigate the hacking issue and, more recently, that police officials accepted bribes from journalists connected to the News of the World.

Sir Paul denies having any knowledge or involvement with the 2006 investigation.

The U.S. Justice Department is currently working with Britain’s Serious Fraud Office to review allegations that the News of the World paid $160,000 to Scotland Yard police officers. According to MSNBC.com, the investigation is the department’s first step in determining whether the payments violated the U.S. Foreign Corrupt Practices Act, which makes it illegal for an American company to bribe foreign government officials.

News Corp., based in Delaware, also faces accusations from shareholders that Rupert Murdoch misused the publication’s assets. In a lawsuit filed in Delaware Chancery Court, a group of shareholders claim a $650 million News Corp. purchase of a British TV production company, owned by Elizabeth Murdoch, resulted in a $250 million windfall for the medial mogul’s daughter.

The complaint also alleges that in the past three years, News Corp. paid excessive compensation to Murdoch in the amount of $74 million. The shareholders claim that Murdoch’s contribution of $1.2 million to the Republican Governor’s Association in 2010 is an example of his eagerness to use corporate funds to advance his “conservative political agenda,” reported MSNBC.com.

News Corp. has not responded to the lawsuit which includes additional allegations of the phone-hacking scandal.

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